Go Get ‘Em, Donald!

Why Sterling should sue the pants off the NBA.

TMZ reported last week that embattled L.A. Clippers owner Donald Sterling is considering suing the National Basketball Association. But according to the Los Angeles Daily News, Sterling has been rejected by at least eight law firms, who worry that taking him on as a client may upset existing clients and their images.

But does Sterling have a case? Yes.

Let’s take a look.

First, was Sterling’s punishment (a $2.5 million fee and a lifetime ban) justified by the NBA’s Constitution and By-Laws?

The NBA based the punishment on Article 24 of the NBA Constitution, which reads:

Where a situation arises which is not covered in the Constitution and By-Laws, the Commissioner shall have the authority to make such decision, including the imposition of a penalty, as in his judgment shall be in the best interests of the Association. The penalty that may be assessed under the preceding two sentences may include, without limitation, a fine, suspension, and/or the forfeiture or assignment of draft choices. No monetary penalty fixed under this provision shall exceed $2,500,000.

But notice the first bit: “[w]here a situation arises which is not covered in the Constitution and By-Laws….” Sterling’s situation is, however, addressed in the documents – hence Article 24 does not apply.

Where are Sterling’s circumstances addressed? In Article 35A(c), which reads:

(c) Any person who gives, makes, issues, authorizes or endorses any statement having, or designed to have, an effect prejudicial or detrimental to the best interests of basketball or of the Association or of a Member or its Team, shall be liable to a fine not exceeding $1,000,000 to be imposed by the Commissioner. [emphasis mine]

In other words, the NBA did consider a situation such as this (a member of the organization making an ill statement), specifically addressed it, and prescribed the punishment. That punishment is $1 million (not $2.5 million) and no ban (certainly not a lifetime ban, as was imposed on Sterling).

It gets more complicated, however. The next clause, Article 35A(d), covers another area of discipline:

(d) The Commissioner shall have the power to suspend for a definite or indefinite period, or to impose a fine not exceeding $1,000,000, or inflict both such suspension and fine upon any person who, in his opinion, shall have been guilty of conduct prejudicial or detrimental to the Association. [emphasis mine]

You’re probably thinking: “What’s the difference between (c) and (d)” or “Was someone actually paid to write this terribly worded document?” (The NBA constitution, for the record, is five times longer than the Constitution of the United States.)

Both are excellent questions. But let’s stick with the first. While 35A(d) allows for a lifetime suspension, that disciplinary measure is limited to punishment regarding conduct. Sterling’s statements could fall under the umbrella of ‘conduct,’ but when there is a contradictory clause that more specifically touches upon the situation (e.g., a clause specifically addressing an ill statement) that would be the clause most courts would find applicable. Subsection (d) and its potential lifetime ban seem to refer to a broader situation: not a harmful statement/s but a harmful action.

And this is all assuming the ‘statement’ or ‘conduct’ referred to in the documents encompasses statements or conduct outside of one’s NBA-related or professional capacity. It is arguable – and likely – that they were not, in fact, intended to extend into one’s personal and private life.

It therefore seems the applicable clause to this situation is Article 35A(c), not Article 24, in which case the punishment should simply be a fine of $1,000,000.

Alright, but even if the fine imposed was incorrect under the documents, the other owners can still force him out, right?

Legal analysts have breathlessly proclaimed that yes, Sterling can be forced out by three-fourths of the NBA Board of Governors (which consists of the other NBA owners). They are citing Article 13 of the NBA Constitution.

Article 13 requires certain violations for this to be allowed, with subsection (a) stating members may be shown the door if they “Willfully violate any of the provisions of the Constitution and By-Laws, resolutions, or agreements of the Association,” and subsection (d) authorizing this sanction if a member is found to “Fail or refuse to fulfill its contractual obligations to the Association, its Members, Players, or any other third party in such a way as to affect the Association or its Members adversely.”

But what contract or agreement with the NBA did Sterling breach exactly? The Constitution and By-Laws make no mention of a morality clause for owners. The documents do, interestingly enough, mention such requirements for players (in the By-Laws, Section 2.01). But the lack of a morality clause for owners almost implies the owners are not subject to such restrictions. Even if Sterling and other owners signed separate morality contracts with the NBA, the wording of such would need to be closely analyzed. It would also need to be decided whether a private conversation was a breach of any such morality agreement.

In a Q&A regarding the legality issues, an ESPN legal analyst was asked: “Sterling is notoriously litigious. Can he go to court to stop Silver from punishing him?,” to which he answered:

Not effectively. When Silver issues his punishment to Sterling, the decision is final. The constitution provides in Paragraph 24(m) that a commissioner’s decision shall be “final, binding, and conclusive” and shall be as final as an award of arbitration. It is almost impossible to find a judge in the United States judicial system who would set aside an award of arbitration. Sterling can file a lawsuit, but he would face a humiliating defeat early in the process . . .

Don’t be so sure. While the documents do give Commissioner Adam Silver ultimate authority in this decision, that is only if Silver’s decision was grounded in, and supported by, the governing documents. As shown above, it is entirely arguable that the punishment was not, in fact, in line with the NBA’s rules.

So what would be Sterling’s recourse?

In addition to the breach of contract, breach of implied contract, or business interference claims, Sterling may also boost his case by arguing that the NBA has inconsistently applied its Constitution and By-Laws. Other owners and players have misbehaved yet have not received a corresponding punishment (see the New York Post’s Phil Mushnick’s piece, “NBA’s zero tolerance hypocrites feast on Sterling’s carcass”).

In addition, there is the angle of whether the provision in the NBA documents, allowing a member to be deprived of his ownership interest, is an unconscionable provision and should be void. A ban from attending games or actively participating in the organization’s events and decisions? Sure, fair enough. But depriving Sterling of his property? That does not seem to pass the smell test. When Sterling recently exclaimed: “You can’t force somebody to sell property in America!” , he hit upon a valid defense. Critics were quick to smirk by bringing up the existence of eminent domain, but the (controversial) practice of eminent domain exists because one’s property rights are balanced against a compelling governmental or societal interest. Where is the societal interest or need in forcing Sterling to sell his property?

The NBA may have reacted too confidently and too quickly in the wake of the Sterling witch-hunt, biting off more than it was able to chew. A more sensible approach of slowly exploring its true legal options would have been the prudent course, rather than rushing to those calling for Sterling’s head. Now, the organization finds itself in a pickle. To make matters trickier, as tempers slow down, public opinion is starting to shift in favor of Sterling, as Forbes’s Mike Ozanian reported this weekend. A Rasmussen poll last week found only 38 percent of Americans feel Sterling should be forced to sell the team – and that was before Sterling’s apologetic appearance with CNN’s Anderson Cooper.

Why should anyone care? Because Americans are rightly growing weary of watching others – whether it is a celebrity or an Average Joe – lose their livelihood, even their lifetime’s work, over mere remarks. For a civilization fond of the “actions speak louder than words” axiom, lately we feel justified in dragging to the stocks anyone who says the wrong thing. And employers (whether it is a network reacting to Phil Robertson’s interview, or the NBA reacting to the Donald Sterling tape) are far too quick to give in to the hysteria. The NBA certainly rushed to chastise and severely punish Donald Sterling, largely to appease the mob.

Sterling fighting back against the NBA would be a lesson to us all, and a favor to us all. Perhaps an embattled billionaire is just the man with the will and the resources to draw the line in the sand. Even for those unforgiving souls who nonetheless continue to find Sterling repugnant, remember – it may someday be you dragged before the kangaroo court of public opinion.

As Thomas More remarks in A Man for All Seasons, when pressed as to why he would defend Richard Rich: “Yes, I give the devil the benefit of law, for my own safety’s sake.”